Marketing fundamentals and key concepts

¶ … promotional strategy may be defined as a way to optimize sales advertising, public relations, personal selling, and sales promotion. Promotion is one critical component of the overall marketing mix of price, place, promotion, and product. Promotional mixes today include social media as well as traditional advertising. Promotional strategies must effectively communicate the competitive advantage that can be secured by using the product, including quality, speed of delivery, low prices, or other unique features.

Although promotion can seem like a mysterious, complicated process, it is essentially about communicating effectively. Promotional messages can be communicated individually, as in the case of a personalized sales pitch, or on a mass level. The communications process in all instances is defined as sending; encoding the message; sending the message through a message channel; decoding the message; and receiving the message. The receiver and sender are on a continual feedback channel although 'noise' can obfuscate the message and distract both parties.

The new model of virtual promotion through the Internet has expanded the ability for marketing messages to be personalized. While before advertising was data-driven (for example, deciding to position an advertisement at a certain time slot to attract young people), today marketing can be more personal through the Internet, and specifically tailored to individual needs (such as Amazon making suggestions based on your past search history).

Regardless of the venue, all marketing has the aims of informing, persuading, and reminding the consumer. The emphasis on these different components will vary, depending on the stage of the product's lifecycle. At the beginning of the product's existence, the likely aim of the company is mainly to inform consumers. As awareness grows, the company may take a more aggressively persuasive stance. Finally, once the core base has been identified and there is demonstrable product loyalty, then the company can shift to an emphasis on reminding consumers of its existence. Informative positioning increases awareness and explains the product; persuasion may demonstrate how the product is superior to its competitors; reminding reminds consumers of the product's existence, its use, and where to buy it.

Advertising is no longer solely distributed through traditional media alone. The disadvantages of traditional advertising like print and television was that although it reached a mass audience, its costs were high, in contrast to the cheaper and more personalized form of world wide web advertising. Advertising should be distinguished from public relations which is generally designed to create goodwill about a product or a brand (such as a press release about Starbucks' sustainability initiatives). Sales promotion activities are all activities that cannot be subsumed under other such designations such as free samples, coupons, contests (such as the Pillsbury Bake-Off), and other giveaways. And of course, there is also one-on-one personal selling, one of the oldest forms of sales (this can also take the form of relationship-based selling as well as traditional methods).

Promotions can be used to create connections and relationships with customers such as building a presence on social media: this may not seem like selling at all but rather creates a sense in the customer's mind that he or she has a connection with the company and his or her identity is bound in a kind of friendship with the company via twittering or Facebook-ing. There has been a profound shift away from companies simply 'telling' customers about their products and the new wave of advertising is more of a dialogue.

Relationship marketing can create greater enthusiasm in the heart of cynical customers given they do not feel as if they are being hoodwinked or patronized with a sales pitch. Regardless of the venue, however, the AIDA (attention, interest, desire, action) model remains a good approach to generate customers and communicate a clear message through promotional tools. The ways in which AIDA are deployed in the promotional mix, however, are dependent upon a wide variety of factors, including the stage in the product lifecycle; the nature of the product; target market characteristics; types of buying decisions required by the product; company finances available to advertise the product; and whether customers are 'pulled' towards the product or the product is 'pushed' upon them. In other words, marketing a car is very different than marketing a new kind of soap.

Chapter 16

Advertising is omnipresent today and the numbers of persons working in the field is ever-growing, given the expanded venues for advertising in today's media economy. Because of the crowded nature of the communications market, however, new brands must spend a proportionately greater income of their bottom line to attract attention. Given the expenditures needed to mount an effective campaign, it is essential that advertising generate or reinforce positive attitudes rather than negative ones.

The major types of advertising are institutional advertising (which tie in with corporate identity and advocacy-type advertising), product advertising (pioneering, competitive, comparative). 'Pioneering' advertising stresses the newness of the product and its unexpected benefits. Competitive advertising generates brand awareness, appeal, and emotional associations with the brand. Comparative advertising, as its name suggests, makes a comparison with the product and its major competitors (a good example of this is the continuing rivalry between Burger King and McDonald's or Coke and Pepsi).

Advertising campaigns require a series of creative decisions. A campaign is often focused around a common slogan, theme, or other type of appeal. It is essential to define the target audience; define the desired percentage of change demanded by the ad; define the need time frame for change. Creative decisions include identifying product benefits; developing and executing advertising appeals; executing the message; and evaluating the campaign's effectiveness.

Selling the 'sizzle' rather than the 'steak' is at the heart of advertising campaigns when identifying benefits: advertisers must tap into primal emotions to motivate customers including profit, health, fear, convenience, and other salient attributes. The style which is used to communicate these attributes may be equally varied, spanning from a 'slice of life' appeal showing people in normal settings; communicating a distinct mood; using carefully presented scientific evidence or humor. The type of product will influence such creative choices, as will the type of media used. For example, the appeal used to sell a pain relieving drug for children will be different from the appeal used to sell a toy.

The Internet is being increasingly favored over newspaper, radio, television and other traditional (and more expensive) forms of advertisement, although it is more difficult to determine effectiveness and return-on-investment. Also, not all customers have Internet access. Public relations may make use of similar venues although it is often used to convey more complex messages such as damage mitigation. Coupons and other forms of sales promotion may combine with advertising efforts to further generate interest in the product.

Chapter 17

Just as advertising is increasingly becoming relationship-based, so is selling, departing from traditional 'hard sell' approaches favored in previous eras. Today, customers must be 'managed' not merely regarded as bases of profit. Salespersons must cater to the specific needs of the client, not merely present their product, and critical components of the sales process includes needs assessment to understand the reasons the customer might purchase the product and tailoring the promotional offerings to meet those needs in individuated, specific ways.